Ajay Piplani, Ambala Cantt V. ADIT,CPC, Bengaluru

ITA 114/CHANDI/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4067 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2019-2020
• Appeal Filed On: 24-05-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 43B; 143(1); 205; 250; 139(1)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH A, CHANDIGARH , ! ' # $ %! , BEFORE: SHRI SANJAY GARG, JUDICIAL MEMBER AND SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER ./ ITA NO.114/CHD/2021 / ASSESSMENT YEAR : 2019-20 AJAY PIPLANI, H.NO.179, BANK ROAD, AMBALA CANTT. AMBALA CANTT 133001, HARYANA. THE ASSISTANT DIRECTOR OF INCOME TAX, CENTRALISED PROCESSING CENTRE(CPC)), BENGALURU. ./PAN NO: ALZPK1752B /APPELLANT /RESPONDENT /ASSESSEE BY : SHRI DHRUV GOEL, CA ! / REVENUE BY : SMT.MEENAKSHI VOHRA, ADDL. CIT ' # $ /DATE OF HEARING : 24.08.2021 %&'( $ /DATE OF PRONOUNCEMENT : 04.10.2021 (HEARING THROUGH WEBEX) /ORDER PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER : THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS), DELHI [(IN SHORT THE LD. CIT(A)] NA TIONAL FACELESS APPEAL CENTRE (NFAC) DELHI, DATED 2 9.04.2021 ITA NO.114/CHD/2021 A.Y. 2 019-20 PAGE 2 OF 6 RELATING TO ASSESSMENT YEAR 2019-20, PASSED U/S 250 OF THE OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED T O AS ACT). 2. THE SOLITARY ISSUE IN THE PRESENT APPEAL RELATES TO THE ADDITION MADE TO THE INCOME OF THE ASSESSEE IN THE INTIMATION MADE U/S 143(1) OF THE ACT, BY DISALLOW ING DELAYED PAYMENTS OF EMPLOYEES CONTRIBUTION TO ESI A ND PF AMOUNTING TO RS.18,21,088/- BY INVOKING THE PROVISI ONS OF SECTION 36(1)(V) OF THE ACT. THE LD.CIT(A) UPHELD T HE ADDITION ON THE BASIS OF THE AMENDMENT EFFECTED BY THE FINAN CE ACT, 2021, TO SECTION 43B OF THE ACT BY INSERTION OF EX PLANATION- 5 AND TO SECTION 36(1)(VA) OF THE ACT BY INSERTION OF EXPLANATION-2, BOTH TO THE EFFECT THAT DUE DATE FOR PAYMENT OF EMPLOYEES CONTRIBUTION TO ESI AND PF, FOR THE P URPOSE OF CLAIMING DEDUCTION OF THE SAID AMOUNT AS PER THE PR OVISIONS OF SECTION 36(1)(VA) OF THE ACT WAS NOT GOVERNED BY SECTION 43B STIPULATING THE DUE DATE TO BE TILL THE FILING OF RETURN OF INCOME U/S 139(1) OF THE ACT, MEANING THEREBY THE EMPLOYEES CONTRIBUTION TO ESI AND PF WAS TO BE PAI D BY DUE DATE SPECIFIED IN THEIR RESPECTIVE ACTS FOR THE PUR POSE OF CLAIMING DEDUCTION THEREOF. THE LD.CIT(A) HELD THAT THE SAID AMENDMENT THOUGH EFFECTED BY THE FINANCE ACT, 2021 BUT ITA NO.114/CHD/2021 A.Y. 2 019-20 PAGE 3 OF 6 WHEN READ IN THE BACKGROUND OF THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF ALLIED MOTORS PVT. LTD. V S. CIT, 91 TAXMAN, 205 (SC), AND THE INTENTION OF THE LEGISLAT URE SET OUT THROUGH THE MEMORANDUM TO THE FINANCE ACT 2021 WHILE INTRODUCING THE EXPLANATIONS TO THE SECTIONS, MADE IT CLEAR THAT THE SAID AMENDMENTS WOULD APPLY TO ALL P ENDING MATTERS AS ON DATE. ACCORDINGLY, HE BRUSHED ASIDE T HE CONTENTION OF THE LD.COUNSEL FOR THE ASSESSEE THAT THE ISSUE ALREADY STOOD DECIDED IN ITS FAVOUR BY THE HON'BLE JURISDICTIONAL HIGH COURT. THEREFORE APPLYING THE AMENDMENTS TO SECTION 43B AND SECTION 36(1)(VA) OF THE ACT, THE LD.CIT(A) UPHELD THE DISALLOWANCE OF EMPLOYERS CONTRIBUTION TO ESI AND PF NOT PAID BEFORE THE DUE DATE SPECIFIED IN THE SAID ACTS. 3. BEFORE US THE LD.COUNSEL FOR THE ASSESSEE SUBMIT TED THAT VARIOUS BENCHES OF THE ITAT HAVE ALREADY ADJUD ICATED THIS ISSUE IN FAVOUR OF THE ASSESSEE. HE REFERRED T O THE DECISION OF THE ITAT, DELHI BENCH IN THE CASE OF IN STA EXHIBITION PVT. LTD VS. ADDL.CIT IN ITA NO.6941/DEL /2017, DATED 03.08.2021, THE DECISION OF ITAT, HYDERABAD B ENCH IN THE CASE OF CRESCENT ROADWAYS PVT. LTD; VS. DCIT IN ITA NO.1952/HYD/2018, DATED 01.07.2021 AND THE DECISION OF ITA NO.114/CHD/2021 A.Y. 2 019-20 PAGE 4 OF 6 ITAT CHANDIGARH BENCH IN THE CASE OF HOTEL SURYA VS . DCIT IN ITA NOS.133 & 134/CHD/2021, DATED 05.08.2021. CO PY OF THE ORDERS WAS PLACED BEFORE US. 4. THE LD. DR WAS UNABLE TO BRING ANY CONTRARY JUDG MENT TO OUR NOTICE, NOR WAS ANY DISTINGUISHING FACTS BRO UGHT TO OUR NOTICE. HE HOWEVER RELIED ON THE ORDER OF THE C IT(A). 5. WE HAVE HEARD BOTH THE PARTIES. IT IS NOT DENIE D THAT THE EMPLOYEES CONTRIBUTION TO ESI AND PF WAS ALLOWABL E AND CLAIMED AS DEDUCTION BY THE ASSESSEE ON THE STRENGT H OF VARIOUS DECISIONS OF THE JURISDICTIONAL HIGH COURT HOLDING CONTRIBUTIONS DEPOSITED BY THE DUE DATE OF FILING O F RETURN OF INCOME U/S 139(1) OF THE ACT AS ALLOWABLE. THE REVE NUE HAS DISALLOWED THE SAME IN THE IMPUGNED YEAR BY APPLYIN G THE AMENDMENT MADE BY FINANCE ACT 2021 TO SECTION 36(1) (VA) AND 43B OF THE ACT ALLOWING THE CLAIM OF SUCH DEDUC TION ONLY WHEN PAID BY DUE DATES SPECIFIED IN THEIR RESPECT IVE ACTS, HOLDING THE AMENDMENT TO BE APPLICABLE ON ALL PENDI NG CASES POST THE AMENDMENT. 6. WE HAVE GONE THROUGH THE ORDERS OF THE COORDINAT E BENCHES OF THE ITAT CITED BY THE LD.COUNSEL FOR THE ASSESSEE BEFORE US AND HAVE NOTED THAT IT HAS BEEN CONSISTE NTLY HELD ITA NO.114/CHD/2021 A.Y. 2 019-20 PAGE 5 OF 6 THAT THE AMENDMENT TO SECTION 36(1)(VA) AND U/S 4 3B OF THE ACT EFFECTED BY THE FINANCE ACT 2021 IS APPLIC ABLE PROSPECTIVELY ,READING FROM THE NOTES ON CLAUSES AT THE TIME OF INTRODUCTION OF THE FINANCE ACT, 2021, SPECIFICA LLY STATING THE AMENDMENT BEING APPLICABLE IN RELATION TO ASSES SMENT YEAR 2021-22 AND SUBSEQUENT YEARS. THEREFORE THE A DDITION, WE HOLD, CANNOT BE MADE ON THE STRENGTH OF THE AMEN DMENT EFFECTED BY FINANCE ACT 2021 TO SECTION 36(1)(VA)/4 3B OF THE ACT. MOREOVER IT IS AN ADMITTED POSITION THAT THE JURISDICTIONAL HIGH COURT HAS IN VARIOUS DECISIONS HELD THAT EMPLOYEES CONTRIBUTION TO ESI & PF IS ALLOWABLE IF PAID BY THE DUE DATE OF FILING RETURN OF INCOME U/S 139(1) OF THE ACT. THE JURISDICTIONAL HIGH COURT HAS HELD SO IN THE FO LLOWING CASES: 1) CIT VS. NUCHEM LIMITED, ITA NO.323 OF 2009 2) CIT VS. HEMLA EMBROIDERY MILLS PVT. LTD.(2014), 366 ITR 167 7. IN VIEW OF THE ABOVE, WE HOLD THAT THE CLAIM OF EMPLOYEES CONTRIBUTION TO ESI AND PF AS PER SECTION 36(1)(VA) OF THE ACT CANNOT BE DENIED IN THE IMPUGN ED YEAR, I.E. 2019-20 ON THE BASIS OF AMENDMENT MADE TO THE SECTION BY FINANCE ACT 2021. THE ORDER OF THE LD.CIT(A) UP HOLDING THE SAID DISALLOWANCE TO THE TUNE OF RS.18,21,088/- IS ITA NO.114/CHD/2021 A.Y. 2 019-20 PAGE 6 OF 6 THEREFORE SET ASIDE AND THE AO IS DIRECTED TO ALLOW THE CLAIM OF THE ASSESSEE.. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED ON 4 TH OCTOBER, 2021. SD/- SD/- ' # $ %! (SANJAY GARG) (ANNAPURNA GUPTA) /JUDICIAL MEMBER &' /ACCOUNTANT MEMBER )' /DATED: 4 TH OCTOBER, 2021 * ! * &) *+,+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ' - / CIT 4. ' - ( )/ THE CIT(A) 5. +./ 0 , $0 , 123/4 / DR, ITAT, CHANDIGARH 6. /35# / GUARD FILE &) ' / BY ORDER, / ASSISTANT REGISTRAR